There are lucrative contracts to be won by Northern Territory companies from the US Defence build-up in Darwin.

But experts say that NT business must be good enough to do the work – being “local” isn’t enough – and must understand the rigorous tendering process.

The Territory chapter of the Australian Industry Defence Network and leading law firm Ward Keller brought lawyer and US Defence contract expert Bill Savarino to Darwin to explain to business owners how to “bid” for work.

America plans to co-invest $2 billion in the Territory over the next 10 years upgrading RAAF Base Darwin, Robertson Barracks, RAAF Base Tindal, and the Kangaroo Flats, Bradshaw Field and Mt Bundey training grounds.

The Australian Defence Department intends to spend $20 billion in northern Australia over the next two decades in infrastructure, maintenance and personnel.

Mr Savarino says NT companies are capable of tendering for many of the US contracts, including construction, design, professional services, logistics, maintenance, supplies and transport – either as prime contractors or, more likely, as subcontractors.

Darwin-based construction company Sunbuild has already won a $2.4 million American contract at RAAF Base Darwin.

Mr Savarino met dozens of business people during his time in Darwin.

He held three information forums, including a breakfast event and a masterclass, followed by one-on-one sessions – all subsidised through the support of the NT Government.

“I’m very impressed by the calibre of business here,” says Mr Savarino, who is based in Washington DC. “I’ve met some incredibly enthusiastic, sharp contractors.

“And the NT Government is fantastic in driving this and supporting business – you wouldn’t get that sort of support in the States.

“Things are looking good for the Northern Territory.”

He says tendering conditions for US Defence work are “very different” from Australian procedures.

“Contractors need to understand the regulations and understand how to use them.”

The biggest difference is the requirement for a “bond”, an insurance policy to ensure companies:

Can do what they say they can do in their tender

Meet performance targets

Protect subcontractors

The US bonds are typically 220 percent of the project value, compared with Australia’s 5 percent.

“The US Government is very risk averse on foreign procurements,” says Mr Savarino. “They want to make sure they’re not buying a pig in a poke.”

Bond insurance premiums can be high.

Mr Savarino accepts that the US bond will frighten many companies, especially smaller firms, but he says there is discretion to lower the bond or even remove it.

AIDN-NT chief executive Kerryn Smith says Territory businesses should “position themselves” now to be ready for work on the American military build-up.

She says preparations should include forming relationships with bigger companies that are likely to be prime contractors. For many tiered suppliers, this could be an opportunity to provide their products and services to new primes, or do more work with existing primes.

Ms Smith says it’s still early days with US procurement and what will be on offer has not yet been released.

But she says the AIDN-NT and other organisations, such as the Chamber of Commerce and Master Builders Association, will continue to help advertise work packages to Territory business.

“There’s no entitlement just because you’re local. You have to win work on merit. Our role is to help suppliers pre-position themselves so that they can qualify to win work.”

Other major Territory projects in the pipeline include the start of the onshore oil and gas industry, the possible expansion of Darwin LNG and the Inpex plant, the $200 million Landbridge hotel, the doubling in size of Darwin Port, the $100 million shiplift facility, the rejuvenation of Darwin and Alice Springs city centres, the truck depot on the outskirts of Darwin and several mines going into operation.

“There are so many projects – many are taking off at the same time,” says Ms Smith. “It’s unprecedented.”

She says Top End companies can benefit by not only winning contracts in their own right but being local partners and subcontractors for big interstate and international companies.

“We want to be the support and maintenance hub for the north, and indeed, the Indo-Pacific region.”

“We want to strengthen our industrial support base in the Northern Territory.”

Mr Savarino says that unlike oil and gas spending, Defence expenditure tends to be more consistent and less vulnerable to market variations.

“Defence is a long-term game, which means things are looking up for Darwin. It’s a city where people are flexible – they can react to opportunities very quickly and the business community is tight and supportive.

“The growth in Defence will not just benefit the companies that win contracts. You’ll likely see the whole of the Northern Territory benefit. And as that happens, it is foreseeable that more and more people will see the potential of the region and invest here.”

Mr Savarino has been working with Ward Keller American-born lawyer Bradly Torgan, who is also experienced at US procurement law and can provide local support for businesses tendering for US Defence work.

The Greater Darwin region is still recovering from the damage caused by Cyclone Marcus. Local residents are now asking who is responsible for the cost of repairs to a dividing fence when the damage has been caused by a fallen tree from a neighbouring property during the storm.

The general legal position in the Northern Territory is that where damage is caused to a dividing fence, the owners of land on either side of the fence must equally contribute to the cost of the repairs. This includes damage caused by a natural disaster such as a cyclone. In this circumstance, the neighbour should be approached to discuss the damage and the appropriate repairs that need to be made to the fence.

A Notice to Repair can be served on a neighbour requiring them to contribute to one half of the repairs. The Notice to Repair must identify the part of the fence that is to be repaired and the nature of the repairs. The repairs must reinstate the fence as it originally was and should not include upgrades to the fence. If an agreement still cannot be reached, and a month has passed, the repairs to the fence can be completed and half the costs recovered from the neighbour.

There is, however, an exception if it can be established that the damage was caused by a neighbours’ negligence. If negligence is proved the neighbour must pay for the full cost of the repairs to the fence. But how can negligence be proved when it seems the tree has fallen because of severe winds in a cyclone?

Negligence can be proved if there was an obvious risk, before the cyclone, that the tree was likely to cause damage and the neighbour failed to do anything about it. Examples include noticeably dangerous trees that are decaying, falling down or losing branches, suffering termite infestation, trees that have been planted in an inappropriate environment or where complaints by neighbours have been made about the tree and ignored. Neighbours may also have an obligation to inspect a tree if there is something to indicate it could be dangerous for example when building work has occurred too close to the tree and caused damage. However if the tree appears to be healthy and an inspection would not have revealed any obvious danger, the neighbour will not be negligent.

If it can be proved a fence was damaged due to a neighbour’s negligence the neighbour must repair the fence. If after a month the fence has not been repaired, the fence can be repaired and the costs recovered from the neighbour.

It should be noted that negligence would be difficult to establish in this circumstance as it must be proved something other than the cyclone contributed to the tree falling down. Whether a neighbour is negligent will depend on the individual circumstances of the case and independent legal advice should always be obtained.

Any disputes that arise in relation to repairs to a fence can be taken to the Northern Territory Civil and Administrative Tribunal. For more information visit: http://ntcat.nt.gov.au/.

Disclaimer

The advice provided in this article is of a general nature only and should not be substituted for obtaining your own independent legal advice. If you think your fence has been damaged due to a neighbours’ negligence please contact Ward Keller on (08) 8946 2999 or wardkeller@wardkeller.com.au for further advice.

Ward Keller has become aware of Ward Keller-branded phishing emails in circulation which may contain malicious software.

The scam purports to be an email from Ward Keller requesting you to view or download the bogus invoice to arrange payment.

If you receive this type of email, we strongly encourage that you do not click any links or attachments and to please screenshot or forward any emails to wardkeller@wardkeller.com.au and then delete it.

Do you use a name, brand or logo in your business? Do you want to want to ensure you have exclusive rights to use, license or sell your name, brand or logo? Do you want to ensure you can stop anyone else from using your name, brand or logo for similar goods and services? Did you know that registering your business or company name or purchasing a domain name is not the same as trade marking it?

Speak to our new Trade Mark Attorney (and the only one in the NT!), Jacqueline Leong to discuss your options to protect your name, brand or logo.

There has been a lot of anxiety over yesterday’s announcement on subclass 457 visas being abolished. We have been closely following the developments and the proposed changes. Here’s a summary of what you should know:

Currently hold a subclass 457 visa and planning to apply for permanent residency?

Your visa will continue to be in effect under the same conditions and validity period. If you were planning on applying for permanent residency, you should seek advice and reassess your eligibility without delay. From March 2018, the list of occupations that can be nominated for certain visas such as the Regional Sponsored Migration Scheme (Subclass 187), Employer Nomination Scheme (Subclass 186), and skilled visas (subclasses 190, 189 and 489) will be shortened.

Applied for a subclass 457 visa and awaiting a decision?

If your associated nomination application has not been approved yet, your application may be affected if your nominated occupation is not on the new Medium and Long-term Strategic Skills List (MLTSSL) or the Short Term Skilled Occupation List (STOL) (see http://www.border.gov.au/Trav/Work/Work/Skills-assessment-and-assessing-authorities/skilled-occupations-lists/combined-stsol-mltssl). Nominations for certain occupations that are on this list can still be affected if that occupation is subject to a new ‘caveat’ placed on it. These are new requirements placed on nominations for certain occupations.

If your nominated occupation is only on the STOL but not the MLTSSL, then the validity of your visa will be limited to 2 years. You can renew it for a further 2 years, but there will be no pathway to permanent residency.

Wanting to lodge a subclass 457 visa application?

The subclass 457 visa is still open for new applications. However, you must ensure that your nominated occupation is currently on the MLTSSL or STOL and meets any caveat requirements. The list of eligible occupations and other requirements such as skills assessments are likely to change in July 2017. We understand that the subclass 457 visa will be phased out by March 2018 and replaced with 2 other temporary employer sponsored visas. There will be other changes introduced such as the requirement for work experience, skills assessments, police clearances and English level.

The only independent analysis of the Federal and Territory Governments’ budgets for 2016/ 2017.

SAVE THE DATE

THURSDAY 26 MAY 2016

7.15am – 9.30am

SKYCITY

Proudly supportingHeartKids
This is a not-for-profit event and nett proceeds from the Breakfast will be donated to HeartKids SA and NT. Where they will be able to get new medical equipment and some video games with Armchair Empire for entertain the kids during though times using gaming resources online.

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